"Poor people are like Bonsai trees" : an analysis of Muhammad Yunus’ thoughts on microcredit, poverty and the poor

Heino, Päivi (2010)

Tiivistelmä

This study challenges the dominant microcredit discourse, which treats microcredit as a relatively problem-free approach to poverty reduction and women’s empowerment. Proponents of microcredit argue that it is an efficient poverty reduction and women’s empowerment instrument. It is claimed that access to tiny loans enables poor to help themselves by engaging in income-generating activities, and to improve not only their own well-being but also well-being of their families. Women are preferred as borrowers instead of men, because they tend to contribute more to household welfare than men and because they are a better credit risk. Astonishingly high repayment rates of 95–99 % are interpreted as proofs of women’s success with their micro-businesses, although they rather only tell that loans are paid back.

There seems to be a gap between proponents’ rhetoric and microcredit practice: Rather than being a solution to women’s problems of poverty and powerlessness, microcredit helps to cope with poverty and sudden crisis and enables sustaining minimum level of subsistence. Critiques remind that microcredit has a flip side, which is associated with indebtedness, tensions and further exclusion of the poorest. Microcredit does not automatically generate larger economic improvements or a desired change in gender relations and in women’s position in society.

Problematic of microcredit as poverty reduction and women’s empowerment strategy is investigated by analysing speech of Muhammad Yunus, the founder of Grameen Bank. How Yunus speaks about poverty and poor people in the context of microcredit, and what might be wrong with his thinking? Is it realistic to assume, that access to microcredit alone will enable rural Bangladeshi women to change their lives? In the case of Bangladesh, women’s suffering can largely be explained with the traditions of male supremacy and gender discrimination, which also hinder women’s prospects of launching successful micro-businesses. This study argues that microcredit contains neoliberal mindsets that aim to depoliticise poverty, transform it into problem of individual and shift responsibility of empowerment and poverty alleviation into shoulders of Third World women, who are expected to succeed within pre-negotiated circumstances.